Mumbai: In a major setback to the operations creditors of the Essar Steel, the Supreme Court on Monday rejected the pleas by them, seeking a stay on a National Company Law Appellate Tribunal (NCLAT) order asking the NCLT Ahmedabad to take a decision on the debt-laden company’s case by February 11.
The SC order of rejecting the pleas means that the NCLT will have to decide on the case and thereby approve ArcelorMittal’s bid. The petition before the National Company Law Tribunal (NCLT) was moved on February 1 by the former managing director of Essar Steel Dilip Oommen along with its project director Rajiv Kumar Bhatnagar, as well as Ruia.
This fresh move by the Essar Steel directors came after the NCLT-Ahmedabad had on January 29 rejected the debt settlement proposal put forth by the Essar Steel Asia Holdings despite it being much higher at Rs 54,389 crore than the former’s Rs 42,000-crore bid.
The Supreme Court on Monday said the Essar promoters are acting through operational creditors, people and proxies to delay the process and it has been 571 days since the inception of the insolvency proceedings. The NCLAT had said if the orders are not passed by February 11, it will result in them taking over the proceedings.
Earlier on January 3, NCLAT had asked the Ahmedabad bench of NCLT to expeditiously take a final decision in the Essar Steel insolvency case, where ArcelorMittal emerged as the highest bidder. It had asked the NCLT bench to take an early decision in the matter as per the order passed by the Supreme Court in this regard.
The case began on February 12, 2018 when ArcelorMittal and Numetal (originally promoted by Ravi Ruia’s son Revant with a 25 percent stake) submitted the bids to take over the company. On March 21, NCLT has found that both the bids were ineligible under Section 29 of IBC. While ArcelorMittal’s bid was rejected on technical grounds, NuMetal’s was declared invalid for its association with the Ruias.
The tribunal also ordered the RP to fresh bids which were challenged on some technical grounds again. On April 2, the second round of bids were submitted, and NCLT asked the RP not to open the bids till applications were disposed of; and on April 19, it remanded the first bids to RP and the lenders and declared the second bids invalid.
